so frustrated with my bad credit

[HellooooJenny]

I don't understand why I have bad credit. I'm trying to get an iPad on finance for uni, and I can't. It's bloody £25 a month!?? I've never had a penny of debt, I always pay my phone bill and rent etc perfectly on time, I don't even have a credit card because I budget enough and earn enough that I don't need one etc.

And yet I can't even get finance for paypal or anything? Also can't get an overdraft on Monzo - looked out of curiosity because my boyfriend (who is in 11k debt and is currently unemployed) can get a £750 overdraft with them??

where am I going wrong?

You can get your credit file for free on moneysavingexpert, you can also look for interest free purchase credit cards, which would allow you to spread the cost of an ipad, that you might be accepted for. Or you could try your own bank, as they can see how you run your current account and your income is with them.

But it's really 'cutting your nose off to spite your face' to not have a credit card. There are loads of reasons to have one that are nothing to do with borrowing money or being in debt, a gateway to other credit products that you do need for a start. Also purchase protection and hiring a car is likely to be difficult or more expensive without one. Just use it for a few small purchases and set up a direct debit to pay the balance off in full every month.

All the three companies will give you your credit file for free. With some you have to sign up for a free month's trial and then cancel. There is Experian, Equifax and another one I can't remember!

You need to see this before jumping into rash things like getting a credit card. Something as simple as getting on the electoral register could be the solution. Pay monthly utilities like mobiles, gas, electric, and water also all go on your credit file so you can use that to improve your rating. Things like paying insurance monthly instead of over the year can also help.

But get the report to find out how to help. It could be a mistake somewhere, or someone else using your details.

I don't even have a credit card because I budget enough and earn enough that I don't need one etc.

I have a credit card but I pay the balance off in full at the end of the month and enjoy the rewards having the card brings in vouchers etc.

I have a tesco credit card I use for everything. I pay it off in full ever month and use the points for meals out. My credit rating it perfect. Apply for a credit card and use it properly to build your credit.

Another point to make OP and this one shocked me.

Even when you are searching for a loan, credit, finance or any other money borrowing situation, even just by putting you details in to see if your eligible, when declines it’s marked on your credit report.

So if you’ve been continuously looking for somewhere that will give you money for your iPad and you’ve been continuously declined you’ve just been damaging your credit report more. It’s so silly but that’s how my credit rating went to pot.

I was in the same position about 4 years ago.
Never been in debt, never any loans etc. I’m one of those people who saves/works extra shift if I need anything. I had about 23,000 in savings, I needed a mortgage.
I had to get a credit card. That I always pay in full.

I have a Tesco credit card I pay off in full every month - I get Clubcard points on everything I spend that way. I get enough to pay for my monthly delivery pass for free and some left over so it works out as a nice little perk for me, and they keep raising my limit (which I don’t use) which seems to improve my credit rating as I’m then using less of what’s available to me.

Your best bet, make sure you are in the electoral role, then go to your bank and ask for a credit card. Put the iPad on the credit card and pay every month. This will be cheaper than finance and improve your score

I’m beginning to worry that I should be taking the advice on here too!
Credit cards scare me.

Credit cards are simply a payment tool, that often bring extra benefits like cashback, cashflow management, purchase protection - if your supplier fails to deliver or goes bust, you can get the money back from your credit card. If you think of them as such, and not free money, you shouldn't need to be scared.

The thought process of 'can I afford this' is totally separate - things still need to be paid for no matter how they are paid for.

It was having a credit card that allowed me to book new flights with another airline when Monarch went bust 2 days before we were due to fly with them without needing to find new money right then and the cost of the lost Monarch flights and the extra cost of new more expensive flights booked at short notice was all refunded by the credit card.

I think not having a credit card is nuts nowadays!

Just pay off the entire amount every single month, or transfer the exact amount after ever transaction if you prefer. No one has to have debts because you have a credit card.

It does boost your credit rating.

It is also so much safer to use online! Who uses a debit card to buy stuff on the internet?

" I've never had a penny of debt, I always pay my phone bill and rent etc perfectly on time, I don't even have a credit card because I budget enough and earn enough that I don't need one etc."
If you've never had credit then you haven't been able to prove you are credit worthy.

"so I have to have debt to make myself look financially stable? that makes no sense"
You are not wrong. It"s no wonder UK personal debt is increasing year on year.

It is ridiculous but even if you have a lot of debt but are managing to pay off minimum payments on time every month, you will be seen by lenders to be more creditworthy than someone who has never had debt.

You can build up your creditworthiness by such things as having a cheap mobile phone contract which is paid on time every month.

If I were you, I would have a look on Martin Lewis' MSE site and ask for help in building up your credit score.

It sounds like you have a very good attitude to money and debt which will set you in good stead for your life. Keeping your personal debt to a minimum will help you to live as stress-free as possible.

(Sorry, that doesn't help you get your iPad but someone on MSE will probably help you on that).

You have what is known as a thin credit file.

You need to show that you are capable of managing credit. The lender simply doesn’t have enough information about you to approve your application.

It's not having had a credit card. Same thing happened to me when I first when to buy a phone on contract. I was very confused! The best thing to do (I was told, and it worked) is to speak to your bank and explain you want a credit card in order to build your credit rating. They'll probably give you one with a low limit, but if you then use that regularly (and make sure you always pay it off in time!) you'll build a rating up.

If you have never used credit before, certain credit products may be out of your reach due to your thin file.

For example, you’d could be eligible for a cheap phone contract or low limit student credit card/low student overdraft instead - banks wouldn’t trust you with much so you’d likely be rejected for a £5000 limit credit card for example. Likewise an iPad might be out of your reach too, dependant on the lender’s criteria, value etc as a first time credit applicant.

no credit report is just as bad as a bad credit report

my partner is 38 we have been together 20 years,anything household wise went/is in my name even though he claimed the same benefits as me

he tried to get a phone contract in his name January ish(previous one was in mine)and he was turned down in a ee shop

when he explained how much we get per week they said no credit is just as bad as bad credit and advised him to get a small credit card,he did and we used it to pay everything we use day to day then replaced the money back to the penny at the end of the night,within 9 weeks his score went up 200

he then got a letter off ee offering him a contract so we dont know if he was being monitored but we refused on the principle that they can sod off now,they didnt want him then they ain't getting him now ,he got one on my name instead

get a free credit report, i use credit score and they offer you card on your score alone